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Derivative Financial Instruments And Hedging Activities | 3 Months Ended
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Mar. 31, 2012
Derivative Financial Instruments And Hedging Activities [Abstract] |
Derivative Financial Instruments And Hedging Activities |
10. |  | Derivative Financial Instruments and Hedging Activities
As part of our asset and liability management strategy, the Company may enter into derivative financial instruments, such as interest rate swaps, caps and floors, with the overall goal of minimizing the impact of interest rate fluctuations on our net interest margin. Interest rate swaps and caps involve the exchange of fixed-rate and variable-rate interest payment obligations without the exchange of the underlying notional amounts. During the first quarter of 2010, the Company entered into a three-year interest rate cap agreement with an aggregate notional amount of $50 million. Under this cap agreement, the Company receives quarterly payments from the counterparty when the quarterly resetting 3 Month London-Interbank Offered Rate exceeds the strike level of 2.00%. The upfront fee paid to the counterparty in entering into this interest rate cap agreement was $890 thousand. These interest rate cap agreements are considered "free-standing" due to non-designation of a hedge relationship to any of its financial assets or liabilities. Under FASB ASC 815, valuation gains or losses on interest rate caps not designated as hedging instruments are recognized in earnings. At March 31, 2012, the aggregate fair value of the outstanding interest rate caps was $1 thousand, and we recognized mark-to-market losses on valuation of $8 thousand for the three months ended March 31, 2012. At March 31, 2012 and December 31, 2011, summary information about these interest-rate caps is as follows:
|  | March 31, 2012 |  |  | December 31, 2011 |
Notional amounts |  | $ | 50.0 million |  |  | $ | 50.0 million |
Weighted average pay rates |  |  | N/A |  |  |  | N/A |
Weighted average receive rates |  |  | N/A |  |  |  | N/A |
Weighted average maturity |  |  | 0.91 years |  |  |  | 1.16 years |
Fair value of combined interest rate caps |  | $ | 1 thousand |  |  | $ | 9 thousand |
The effect of derivative instruments on the Consolidated Statement of Income for the three months ended March 31, 2012 and 2011 are as follows:
|  |  |  |  | Three Months Ended |
|  |  |  |  | March 31, 2012 |  |  | March 31, 2011 |
|  | Location of Gain or (Loss) Recognized in Income on Derivatives |  |  | (In thousands) Amount of Gain or (Loss) Recognized in Income on Derivatives |
Derivatives not designated as hedging instruments under FASB ASC 815: |  |  |  |  |  |  |  |  |  |  |  |
Interest rate contracts (1) |  |  | Other income |  |  | $ | (8 | ) |  | $ | (22 | )
(1) | Includes amounts representing the net interest payments as stated in the contractual agreements and the valuation gains or (losses) on interest rate contracts not designated as hedging instruments.

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- Definition This element can be used to disclose the entity's entire derivative instruments and hedging activities disclosure as a single block of text. Describes an entity's risk management strategies, derivatives in hedging activities and non-hedging derivative instruments, the assets, obligations, liabilities, revenues and expenses arising there from, and the amounts of and methodologies and assumptions used in determining the amounts of such items. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Statement of Financial Accounting Standard (FAS) -Number 133 -Paragraph 45 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Statement of Financial Accounting Standard (FAS) -Number 133 -Paragraph 44 + Details
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